License Fee Restoration Bill Introduced by Assemblymember Reyes and Local City Officials

Wednesday, January 16, 2019

Sacramento –Yesterday, Assemblymember Eloise Gómez Reyes (D- San Bernardino), accompanied by a group of officials from the city of Fontana, introduced AB 213, a bill that will restore Vehicle Licensing Fee (VLF) revenue to cities that have expanded or incorporated additional areas. Among the local officials to join Assemblymember Reyes were Fontana Mayor Aquanetta Warren and Fontana Chief of Police, Billy Green.

In the wake of the 2008 recession with reduced earnings and income, the California state budget fell into the red as massive declines in revenue occurred mostly due to these reductions in personal income (and taxes), as well as corporate income (and taxes). Still seeking solutions to assist with righting the budget, a 2011 budget trailer bill passed through the legislature that ultimately reallocated over $200 million dollars annually. Under normal circumstances, this revenue would have gone to cities that had recently expanded or annexed new territory to pay for the added services they were now providing.

“The loss of this critical funding in 2011 for cities that annexed, expanded or incorporated new areas meant that they could not adequately provide services to these new areas,” said Assemblymember Reyes. “Cities that are put into this position often scale back on local investments such as public safety or infrastructure. AB 213 will restore essential funding to many cities in California, including Fontana and San Bernardino.”

AB 213 is consistent with previous legislative efforts to address this issue. In 2017, the Legislature approved SB 130 (Budget) which addressed a fix for only four recently incorporated cities that were harmed by the budget trailer bill of 2011. Yet, there are still more than 140 cities that had expanded or annexed areas and lost out on much needed revenue to help pay for city services to these new areas.

Of the cities that lost this funding stream, Fontana and San Bernardino were hardest hit, collectively losing just under $900,000 annually. A similar version of AB 213 was introduced in 2018 by Assemblymember Reyes and received unanimous and bi-partisan support in policy committee but was ultimately held up. For more information on AB 213 or for news about Assemblymember Reyes, click here.

Assemblymember Eloise Gómez Reyes represents Assembly District 47 which includes the cities of Fontana, Rialto, Colton, Grand Terrace, San Bernardino and the unincorporated areas of Muscoy and Bloomington.